The HUD sets rent levels every year for millions of apartments. We looked at HUD rent limits across the country and tried to ascertain whether there were commensurate changes in income levels.
We then rank ordered the top 25 MSAs / City areas by HUD rent growth (annualized) over the past 5 years and analyzed job growth, employment, weekly hours worked.
The trend, was quite mixed, with the only positive variable being weekly income, which had gone up across the board.
Perceptibly HUD wants more people with jobs to stay in affordable homes to service fast-growing cities with more jobs and busier people. And rising incomes are a positive sign for these policy measures.
However, DFW and several parts of California didn’t evidence high-income changes. There is an argument to analyze the distribution of incomes, i.e., are the poor making more money than the rich. Quartiles of the underlying data could provide these answers.
In the future, we shall compare HUD rents with market rents in these areas to understand if it pays to be an affordable housing developer or owner.